What are the HMRC approved mileage rates?

Jordan Macey

April 21, 2021

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Small Business Accounting

The HMRC approved mileage rates are as follows:

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Can I claim personally paid expenses? Guide

Can I claim personally paid expenses?

There may be times when you have no option but to use your personal funds to cover company costs such as paying by cash or if you forget to bring your company card. It's important to keep a copy of the receipt of all expenses but this is especially important when paying for costs and expenses personally. This way, a record of the cost can be kept, logged in your company accounts and then your company can reimburse you for this.

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Can I expense Car hire? Guide

Can I expense Car hire?

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Can I expense Subcontractor costs? Guide

Can I expense Subcontractor costs?

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Can I expense Legal costs? Guide

Can I expense Legal costs?

The costs incurred for engaging professional services-such as hiring a lawyer-can be claimed as an allowable expense, as long as these services are carried out solely for business purposes.

For further information on allowable business expenses, refer to our expenses and allowances guides for limited company directors and the self-employed.

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Can I expense Optical expenses? Guide

Can I expense Optical expenses?

You can claim an eye test as an allowable expense, if it is required for the use of visual display equipment in your work.

In general, you can't claim for glasses or contact lenses unless these items are 'wholly and exclusively used for business purposes', and you're able to prove that you don't use them outside of your working houses. One example would be that you have several pairs of glasses, one of which is used only when you're at work.

For further information on allowable business expenses, refer to our expenses and allowances guides for limited company directors and the self-employed.

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Can I expense Home Rental? Guide

Can I expense Home Rental?

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Can I expense Utilities? Guide

Can I expense Utilities?

If you're renting an office, you can claim utilities as a deductible expense.

If you're using your home as an office, you'll need to work out the proportion of your utilities that you can allocate to business use in order to claim these costs as a deductible expense.

For further information on allowable business expenses, refer to our expenses and allowances guides for limited company directors and the self-employed.

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Christmas Company Expenses Guide Guide

Christmas Company Expenses Guide

  • Christmas expenses overview
  • Staff party claims
  • Gift voucher claims
  • Gift claims
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Limited company expenses & tax allowances guide Guide

Limited company expenses & tax allowances guide

As a limited company director, you want to run your business in the most tax efficient way possible.

One way to achieve this is to claim for allowable business expenses correctly, so that you don't wind up having to pay more tax than you are legally obliged to.

It can be tricky figuring out what you can or cannot claim for, and this is where our guide comes into play.

We'll run through the different expenses you can claim for, but bear in mind that this isn't a definitive guide. Do check out our resource hub on limited company tax topics for more information, or consult our specialist accountants at Forma if you need personalised advice.

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Why are expenses important? Guide

Why are expenses important?

Expenses are important as you can claim them against your revenue, which helps to reduce the amount of tax you need to pay.

For further information on the types of expenses you can claim, refer to our guides for sole traders and limited company directors.

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Self employed advisory fuel rates guide Guide

Self employed advisory fuel rates guide

Advisory fuel rates are recommended repayment amounts a company can use when reclaiming the fuel element on business mileage.

The rates are used to calculate:

  • How much employers should reimburse employees for business travel using the company car
  • How much employees need to repay employers for private travel using the company car
  • The VAT you can claim back on business mileage using your personal vehicle
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What is a use of home allowance? Guide

What is a use of home allowance?

As a self-employed person, there are two ways to calculating the allowance you can claim for working from home. You can claim a fixed rate of £6 per week, or a proportion of household costs used by the business. Further information is available on our resource on the use of home allowance.

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Can I expense Food & drink? Guide

Can I expense Food & drink?

You can claim "reasonable" food and drink expenses when you're travelling for business, if:

  • You're making an occasional business trip outside of your normal pattern of travel
  • You're staying overnight, and are also claiming accommodation costs
  • Your trade is, by nature itinerant

For further information on allowable business expenses, refer to our expenses and allowances guides for limited company directors and the self-employed.

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Can I claim for fuel as well as mileage? Guide

Can I claim for fuel as well as mileage?

Mileage claims are designed to help cover your fuel costs, as well as the running costs of having a vehicle. As such, you can't make separate claims for individual expenses such as fuel, electricity or vehicle repairs.

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Can I claim using the cycle to work scheme? Guide

Can I claim using the cycle to work scheme?

Employers who purchase bicycles and safety equipment for loan to employees can benefit from treating the purchase as capital expenditure eligible for corporation tax relief. VAT can also be claimed back on the purchase unless you are registered on the VAT flat rate scheme.

The loan of bicycles and safety equipment under the cycle to work scheme removes any tax charge to the employee that would usually arise on a taxable benefit.

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Can I expense Travel & subsistence? Guide

Can I expense Travel & subsistence?

You can claim travel-related expenses, as long as the travel is wholly and exclusively for business purposes and isn't considered 'ordinary commuting'. HMRC defines a commute as a trip that you make between your home and a permanent workplace.

You can claim for:

  • costs associated with running a car or vehicle, such as fuel expenses, parking fees and tolls.
  • transport fares for flights, as well as rides taken via train, bus, taxi and ferries
  • meals and accommodation for overnight business trips

You can claim "reasonable" food and drink expenses if:

  • You're making an occasional business trip outside of your normal pattern of travel
  • You're staying overnight, and are also claiming accommodation costs
  • Your trade is, by nature itinerant

For further information on allowable business expenses, refer to our expenses and allowances guides for limited company directors and the self-employed.

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Can I expense Accountancy fees? Guide

Can I expense Accountancy fees?

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Can I expense Business Rates? Guide

Can I expense Business Rates?

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Can I expense Hotels and bed & breakfasts? Guide

Can I expense Hotels and bed & breakfasts?

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Can I expense Phone calls? Guide

Can I expense Phone calls?

As a sole trader:

If you're using your mobile phone line for both business and personal use, you can't claim for line rental. However, you can claim for call costs for business use if you obtain an itemised bill. If you have a separate mobile phone line for business use, you can claim the costs incurred.

As a limited company director:

1. Mobile phone: If your mobile phone contract is between your company and mobile phone provider, and is used for solely business purposes, you can claim the entire bill as an allowable expense.

If you have a personal contract, you can claim for the costs incurred for business calls. You're also able to reclaim the VAT element of the business calls.

2. Landline: If your landline contract is solely for business use, you can claim the cost as an allowable expense. You can also claim for business calls you've made using your home phone line.

For further information on allowable business expenses, refer to our expenses and allowances guides for limited company directors and the self-employed.

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